(The Center Square) − New Orleans officials are pressing ahead with more than $50 million in new street contracts even as the federal funding they are counting on is set to expire at the end of the year.
If a key deadline is not extended, the city would be exposed to tens of millions in unreimbursed costs.
At a City Council meeting Thursday, staff disclosed that the city has executed over $50 million in road-repair contracts tied to the Federal Emergency Management Agency’s Joint Infrastructure Recovery Request, or JIRR, program. The work is supposed to be paid for with FEMA disaster money that must be spent by Dec. 31 unless the agency approves another extension.
Louisiana Legislative Auditor Mike Waguespack told TCS he “made some calls to FEMA and reached out to our congressional delegation to try to try to move the decision along. And as it sits today, we still don’t have a yes or no.”
The extension request has been pending since around June, according to Waguespack.
The Federal Emergency Management Agency has previously granted New Orleans extra time to use its post-Katrina infrastructure allocation. The agency allowed the city to keep spending roughly $1.66 billion in road and drainage funds through the end of 2024, and subsequent city materials describe a roughly $2 billion FEMA-funded JIRR program to rebuild about 400 miles of streets and subsurface utilities.
Waguespack said FEMA has sometimes approved deadline extensions months after original cutoffs, but he warned that the city cannot assume that will happen again. If the Dec. 31 deadline passes without an extension, any work performed under the new contracts after that date may no longer qualify for federal reimbursement, shifting the full cost to the city’s stressed operating budget.
Because of that risk, Waguespack recommended that the Department of Public Works notify contractors as soon as Monday that they should pause work until FEMA acts on the extension request. He framed the advice as a basic protection for city finances, particularly with a new administration preparing to take office.
The contracts were included in a report from the city’s administrative office. It was asked by the City Council to prepare a report on all city contracts executed in the last 60 days.
The administrative office told TCS that they “will not answer questions from reporters.”
